<PAGE>

                                                                   Exhibit 10(b)

________________________________________________________________________________


                    AMENDED AND RESTATED SECURITY AGREEMENT


                                     among


                        ICF KAISER INTERNATIONAL, INC.,


                         CERTAIN SUBSIDIARIES THEREOF


                                      and


                             CORESTATES BANK, N.A.
                                   as Agent


                               December 3, 1997

________________________________________________________________________________
<PAGE>

                    AMENDED AND RESTATED SECURITY AGREEMENT
                   ----------------------------------------

     THIS AMENDED AND RESTATED SECURITY AGREEMENT, dated as of  December 3, 1997
(this "SECURITY AGREEMENT"), is entered into by and among ICF KAISER
INTERNATIONAL, INC. ("ICF KAISER" or "BORROWER"), a Delaware corporation, each
of its subsidiaries signatories hereto (each, a "SUBSIDIARY GUARANTOR" and
collectively the "SUBSIDIARY GUARANTORS") and CORESTATES BANK, N.A., as agent
for the Banks under the Credit Agreement referred to below (in such capacity,
the "AGENT").  ICF Kaiser and the Subsidiary Guarantors are sometimes referred
to herein collectively as the "DEBTORS" and individually as a "DEBTOR."


                                  WITNESSETH:
                                  ----------

     WHEREAS, ICF Kaiser, the Subsidiary Guarantors, the Agent and certain
financial institutions (the "Banks") are parties to a Credit Agreement, dated as
of May 6, 1996, as amended and restated pursuant to the Amended and Restated
Credit Agreement dated as of the date hereof (the "Credit Agreement"), providing
to ICF Kaiser a revolving credit facility for loans and letters of credit, which
loans and letters of credit are secured under and pursuant to a Security
Agreement, dated as of May 6, 1996, between the Debtors and the Agent, as
amended by the First Amendment dated as of December 17, 1996 and the Second
Amendment dated as of June 19, 1997 (the "1996 Security Agreement");

     WHEREAS, it is a condition to the execution and delivery of the Credit
Agreement that this Security Agreement be executed and delivered; and

     WHEREAS, ICF Kaiser, the Subsidiary Guarantors and the Agent desire to
amend the 1996 Security Agreement to add additional Subsidiary Guarantors and as
otherwise provided herein, and to restate the 1996 Security Agreement as so
amended.

     NOW, THEREFORE, in consideration of the premises and intending to be
legally bound hereby, the parties hereto agree as follows:

     1.   DEFINITIONS.

          (a)  As used herein the following terms shall have the meanings
indicated:

          "ACCOUNTS" shall mean all rights to payment for goods sold or leased
or for services rendered, whether or not such rights have been earned by
performance.

          "AGENT" has the meaning set forth in the preliminary paragraph hereof,
and including any successor from time to time serving as "Agent" under the
Credit Agreement.
<PAGE>

          "BLOCKED ACCOUNT" shall have the meaning assigned to such term in
Section 4(a) hereof.

          "CASH CONCENTRATION ACCOUNTS" shall mean, collectively, account no.
1412209809 in the name of ICF Kaiser International, Inc., account no. 1412184330
in the name of ICF Kaiser International, Inc., and such other account or
accounts as ICF Kaiser and the Agent shall from time to time agree, each
maintained with CoreStates Bank, N.A. at its office at 1345 Chestnut Street,
Philadelphia, Pennsylvania, but under the sole control and dominion of the
Secured Party.

          "CHATTEL PAPER" shall have the meaning assigned to such term under the
Uniform Commercial Code.

          "COLLATERAL" shall mean all now-existing or hereafter acquired or
arising (i)  Accounts, (ii) General Intangibles, Chattel Paper, Contracts and
Instruments, (iii) guarantees of any Accounts and all other security held for
the payment or satisfaction thereof, (iv) balance of any deposit, agency or
other account with any Bank, (v) Inventory, (vi) Equipment, (vii) Pledged
Securities and the certificates representing the Pledged Securities, (viii)
Patents and Trademarks, (ix) Discounted Treasuries delivered by the Debtors to
the Agent pursuant to the Credit Agreement, (x) books, records and other
property at any time evidencing or related to the foregoing, together with all
products and Proceeds (including insurance Proceeds) of any of the foregoing.

          "CONTRACTS" shall have the meaning assigned to such term under the
Uniform Commercial Code.

          "CREDIT AGREEMENT" shall mean the Credit Agreement among the Debtors,
the Agent and the Banks, as hereafter amended from time to time.

          "EQUIPMENT" shall have the meaning assigned to such term under the
Uniform Commercial Code.

          "GENERAL INTANGIBLES" shall have the meaning assigned to such term
under the Uniform Commercial Code.

          "GENERALLY ACCEPTED ACCOUNTING PRINCIPLES" shall mean generally
accepted accounting principles as in effect in the United States from time to
time, consistently applied.

          "GOVERNMENT ACCOUNTS" shall mean Accounts the account debtor of which
is the Government of the United States or any agency, department or
instrumentality thereof.
<PAGE>

          "INSTRUMENTS" shall have the meaning assigned to such term under the
Uniform Commercial Code as in effect in the Commonwealth of Pennsylvania.

          "INVENTORY" shall have the meaning assigned to such term under the
Uniform Commercial Code, and in any event, including all inventory, merchandise,
goods and other personal property that are held by or on behalf of a Person for
sale or lease or to be furnished under a contract of service or which gave rise
to any Account, including returned goods.

          "LIEN" shall mean any lien, mortgage, security interest, chattel
mortgage, pledge or other encumbrance (statutory or otherwise) of any kind
securing satisfaction or performance of an obligation, including any agreement
to give any of the foregoing, any conditional sales or other title retention
agreement, any lease in the nature thereof, and the filing of or the agreement
to give any financing statement under the Uniform Commercial Code of any
jurisdiction or similar evidence of any encumbrance, whether within or outside
the United States.

          "LOCKBOX ACCOUNT" shall have the meaning assigned to such term in
Section 4(a) hereof.

          "OBLIGATIONS" shall mean all now existing or hereafter arising debts,
obligations, covenants, and duties of payment or performance of every kind,
matured or unmatured, direct or contingent, owing, arising, due, or payable to
the Banks or the Agent by or from ICF Kaiser or the Subsidiary Guarantors
arising out of the Credit Agreement or any other Loan Document, including,
without limitation, all obligations of ICF Kaiser to repay principal of and
interest on all the Revolving Credit Loans, to make reimbursements or payments
with respect to Letters of Credit, and to pay interest, fees, costs, charges,
expenses, professional fees, and all sums chargeable to the Debtors under the
Loan Documents, whether or not evidenced by any note or other instrument and all
obligations of each Subsidiary Guarantor in guaranty of the obligations of
Borrower.

          "PATENTS AND TRADEMARKS" shall mean patents and trademarks owned,
directly or indirectly, by a Debtor.

          "PLEDGED SECURITIES" shall mean all of the capital stock or other
ownership interests of those domestic Subsidiaries held directly by the Debtors
and 65% of the capital stock or other ownership interests of those foreign
Subsidiaries held directly by the Debtors, except ICF Kaiser Brazil Holdings,
Inc.

                                      -3-
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Set forth in Schedule C hereto is a listing of each of the Pledged Securities
existing on the date hereof.

          "PREVAILING INTEREST RATE" as of any date shall mean the highest rate
of interest then payable by the Debtors under the Credit Agreement.

          "PROCEEDS" shall have the meaning assigned to such term under the
Uniform Commercial Code as in effect in the Commonwealth of Pennsylvania.

          "SECURED PARTY" means the Agent.

          "SELECTED GOVERNMENT CONTRACTS" shall mean all contracts between a
Debtor and the government of the United States or any department, agency or
instrumentality thereof the terms of which provide for gross payments to such
Debtor equal to or in excess of $1 million and other such contracts (without
regard to the amount of gross payments) which have been designated by ICF Kaiser
as "Selected Government Contracts."

          "SUBSIDIARIES" shall mean as to any Person, (i) a corporation of which
shares of stock or other ownership interests having ordinary voting power (other
than stock having such power only by reason of the happening of a contingency)
to elect a majority of the board of directors or other managers of such
corporation are at the time owned, or the management of which is otherwise
controlled, directly or indirectly through one or more intermediaries, or both,
by such Person and (ii) any limited liability company or partnership in which
such Person, directly or indirectly, owns at least a majority of the ownership
interests having ordinary voting power, or the management of which is otherwise
controlled, directly or indirectly, through one or more intermediaries by such
Person, or both.

          "UNIFORM COMMERCIAL CODE" shall mean the Uniform Commercial Code as in
effect from time to time in the Commonwealth of Pennsylvania.

          (b) Capitalized terms used herein and not otherwise defined herein
shall have their respective meanings assigned in the Credit Agreement.

     2.   GRANT OF SECURITY.

          To secure the payment, promptly when due, and the punctual performance
of all of the Obligations, each of the Debtors hereby pledges and assigns to the
Secured Party, and grants to the Secured Party and agrees that the Secured Party

                                      -4-
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shall have, for itself and the ratable benefit of the Banks, a general
continuing lien upon and security interest in all its Collateral, which lien and
security interest shall be a general continuing first priority lien upon and
security interest in such Collateral.

     3.   BOOKS AND RECORDS.

          The Debtors shall faithfully keep complete and accurate books and
records and make all necessary entries therein to reflect the amounts, identity
of account debtors and all  events and transactions giving rise to the
Collateral and all payments, credits and adjustments applicable thereto, shall
keep the Secured Party fully and accurately informed as to the locations of all
such books and records related to the Collateral and shall permit the Secured
Party and its agents to have such access to them and to any other records
pertaining to the Debtors' business as the Secured Party may request from time
to time.

4.        COLLECTION OF ACCOUNTS; ASSIGNMENT OF CLAIMS ACT

          (a)  Until otherwise notified by the Secured Party, the Debtors may
collect all amounts due on the Collateral from the respective account debtors or
obligors liable thereon, but the Proceeds so collected by the Debtors shall be
held by the Debtors in trust for the Secured Party.  Each Debtor shall collect
such amounts by instructing the account debtor thereof to make payment either to
a Cash Concentration Account or to a lockbox account ("Lockbox Account") or
blocked deposit account ("Blocked Account") maintained with a bank that has
entered into a letter agreement with such Debtor and the Secured Party (a
"Blocked Account Agreement") in substantially the form of Exhibit A attached
hereto.  After the occurrence of a Potential Default or an Event of Default, the
Secured Party may, and upon direction of the Required Banks shall, upon five
Business Days notice to ICF Kaiser, terminate the authority hereby given to the
Debtors to make such collections and, acting if it so chooses in the name of any
of the Debtors, collect any amounts due on the Collateral directly or through an
agent, sell, assign, compromise, discharge or extend the time for payment of any
Account or other Collateral, institute legal action for the collection of any
Account or other Collateral and do all acts and things necessary or incidental
thereto, and the Debtors hereby ratify all that the Secured Party shall lawfully
do under the authority hereby granted to it.  After the occurrence of a
Potential Default or an Event of Default, the Secured Party may at any time, and
upon direction of the Required Banks shall, upon five Business Days notice to
ICF Kaiser, notify any account debtor on any Account or obligor with respect to
any other Collateral that the Collateral

                                      -5-
<PAGE>

has been assigned to the Secured Party and is to be paid directly to the Secured
Party. Alternatively, at its election the Secured Party may, and upon direction
of the Required Banks shall, after the occurrence of a Potential Default or an
Event of Default, require the Debtors to, and in such event the Debtors at their
sole expense will, notify account debtors and obligors that payments are
thenceforth to be made directly to the Secured Party. After the occurrence of a
Potential Default or an Event of Default, the Debtors shall not, without the
written consent of the Secured Party at the direction of the Required Banks in
each case, compromise, discharge, extend the time for payment of or otherwise
grant any indulgence or allowance with respect to any Account or other
Collateral.

          (b)  The Debtors represent and warrant that (i) Schedule A contains a
true and correct listing of all Selected Government Contracts in effect on the
date hereof and (ii) as of the date hereof, the Selected Government Contracts
comprise at least seventy-five percent (75%) of the aggregate dollar amount of
all those Government Accounts of the Debtors for which invoices have been
issued.  The Debtors have, as of the date hereof, provided to the Secured Party
executed copies of all notices and instruments (forms of which are attached
hereto as Exhibit B) necessary to allow the Secured Party to cause its security
interest in all Collateral arising from or related to Selected Government
Contracts to be entitled to the rights and benefits provided by compliance with
the Federal Assignment of Claims Act and any regulations thereunder.  If any
Debtor enters into any Selected Government Contract subsequent to the date
hereof, the Debtor shall, within 45 days of the end of the calendar quarter
within which such Debtor entered into such Selected Government Contract, notify
the Secured Party in writing of such Selected Government Contract and execute
and deliver to the Secured Party all notices and instruments of the type
described in the preceding sentence that pertain to such new Selected Government
Contract.  Notwithstanding the provisions of subparagraph (a) of this Section 4,
the Secured Party may, in its sole discretion, and upon direction of the
Required Banks shall, upon five Business Days notice to the Debtors, deliver or
file all such documentation relating to Selected Government Contracts with the
appropriate government officers and take all such other actions as may be
necessary to cause the interest of the Secured Party in such Selected Government
Contracts to satisfy the requirements of the Federal Assignment of Claims Act
and any regulations thereunder, and the Debtors will take all such additional
actions requested by the Secured Party to cause such result.  No Debtor shall
execute or deliver any notice or instrument of the type described in this
paragraph (b) which names as assignee any party other than the Secured Party.

                                      -6-
<PAGE>

          (c)  If any of the Collateral is or becomes evidenced by a promissory
note, draft, trade acceptance, Chattel Paper or Instrument, the Debtors will
promptly deliver the same to the Secured Party appropriately endorsed to the
Secured Party's order.  Regardless of the form of such endorsement, each Debtor
hereby waives presentment, demand, notice of dishonor, protest and notice of
protest and all other notices with respect thereto.  Upon obtaining knowledge
thereof, the Debtors will promptly notify the Secured Party of (i) any material
adverse change in the financial condition of any account debtor on a material
amount of the Accounts, or in the collectability of a material amount of the
Accounts or other Collateral, and (ii) all material claims, setoffs, rejections,
returns and adjustments which may result in a reduction of the liability of an
account debtor on a material amount of the Accounts included in the Collateral.

5.        DEPOSIT OF PLEDGED SECURITIES; REREGISTRATION OF SHARES; RESERVATION
OF VOTING RIGHTS

          (a)  To perfect the security interest of the Secured Party in and to
the Pledged Securities, as provided herein, the Debtors have deposited with the
Secured Party such Pledged Securities as are in certificated form, in each case
endorsed in blank.  At any time and from time to time the Secured Party  may
cause all or any of the Pledged Securities to be transferred into its name or
into the name of its nominee or nominees.

          (b)  At any time after the occurrence and during the continuation of
an Event of Default, the Secured Party shall be entitled to exercise any and all
voting power with respect to the Pledged Securities and shall exercise such
power as directed by the Banks. At all other times each Debtor shall be entitled
to exercise as it thinks fit, but in a manner not inconsistent with the
provisions of the Credit Agreement, all voting power with respect to the Pledged
Securities.

6.        ADDITIONAL COLLATERAL

          In case any dividend of stock or other ownership interest shall be
declared on any of the Pledged Securities, or any shares of stock or fractions
thereof shall be issued pursuant to any stock split involving any of the Pledged
Securities, or any distribution of securities shall be made on any of the
Pledged Securities, whether pursuant to any recapitalization or reclassification
of the capital of any of the Debtors, a reorganization thereof, or otherwise,
the shares or other securities so distributed shall be delivered to the Secured
Party.

7.        TITLE TO COLLATERAL.

                                      -7-
<PAGE>

          (a)  Each Debtor has acquired or shall acquire absolute and exclusive
title to each and every item or unit of the Collateral attributable to such
Debtor free and clear of all Liens, except Permitted Liens as provided under the
Credit Agreement, and each Debtor shall warrant and defend its title to the
Collateral, subject to the rights of the Secured Party, against the claims and
demands of all persons whomsoever.

          (b)  The Secured Party may, at its sole election but without
obligation to do so, discharge any Lien not permitted under the Credit Agreement
and all expenses incurred by the Secured Party in so doing, together with
interest thereon at the Prevailing Interest Rate, shall be added to the
Obligations and shall be payable by the Debtors on demand.

8.        TAXES AND LIENS.

          Except for Permitted Liens, the Debtors shall immediately notify the
Secured Party in the event there ever arises against any of the Collateral any
lien, assessment, tax or other liability, whether or not entitled to priority
over the Secured Party's security interest hereunder. In any such event, whether
or not such notice is given, the Secured Party shall have the right (but shall
be under no obligation) to pay any tax or other liability of any of the Debtors
deemed by the Secured Party in good faith to affect the Secured Party's
interests hereunder. The Debtors shall repay to the Secured Party on demand all
sums which the Secured Party shall have paid under this section in respect of
taxes or other liabilities of any of the Debtors, with interest thereon at the
Prevailing Interest Rate, and the Debtors' liability to the Secured Party for
such repayment with interest shall be included in the Obligations. The Secured
Party shall be subrogated to the extent of any such payment by it to all the
rights and liens of the payee against the Debtors' assets. The Debtors shall
furnish to the Secured Party from time to time upon the Secured Party's request
proof satisfactory to the Secured Party of the making of all payments or
deposits required by applicable law to be made with respect to amounts withheld
by the Debtors from wages and salaries of employees and amounts contributed by
the Debtors on account of federal, state or other income or wage taxes and
amounts due under the Federal Insurance Contributions Act or the Federal
Unemployment Tax Act or any similar legislation.

9.        SIGNIFICANT LOCATIONS; NAME.

          (a)  Each Debtor represents and warrants to the Secured Party that
none of the books and records relating to the Collateral is or will be located
or used at any location other than its respective locations identified in
Schedule B attached hereto, and that none of the Inventory or Equipment owned by
such Debtor (other than de minimis amounts) is or will be located at any
location other than its respective locations identified in Schedule B attached
hereto. The Debtors shall notify the Secured Party in writing prior to any
change in location of any such books and

                                      -8-
<PAGE>

records. If any of the Collateral or any of the Debtors' records concerning any
of the Collateral are at any time to be located on premises leased by any
Debtor, or any premises owned by any Debtor subject to a mortgage or other lien,
the Debtors shall, at the request of the Secured Party, obtain and deliver to
the Secured Party, prior to the delivery of any such Collateral or books or
records to such premises, an agreement in form satisfactory to the Secured Party
waiving the landlord's, mortgagee's or other lienholder's right to enforce
against the Collateral or the Debtors' records concerning the same and assuring
the Secured Party's access to such Collateral and books and records to
facilitate the Secured Party's exercise of its rights to take possession
thereof. The location of each Debtor's chief executive office and, if different,
the location of each Debtor's principal place of business are set forth in
Schedule B, and the Debtors agree to provide the Secured Party prior written
notice of any change of any such chief executive office or principal place of
business of the Debtors. Debtors agree to use their good faith efforts to obtain
within 90 days of the date hereof from the landlord of the premises including
the chief executive office of ICF Kaiser a waiver of such landlord's rights to
enforce any interest against the Collateral.

          (b) Each Debtor represents and warrants that at no time during the
past five years has such Debtor been known by or used any other name, including
any trade or fictitious name, except as disclosed in Schedule B.  No Debtor
shall change its name without giving the Secured Party at least 30 days prior
written notice of such change.

10.       FURTHER ASSURANCES; WAIVER OF PREEMPTIVE RIGHTS; MAINTENANCE OF
COLLATERAL.

          (a) The Debtors shall execute and deliver to the Secured Party from
time to time all such other agreements, instruments and other documents
(including, without limitation, all requested financing and continuation
statements and government contract notices and all requested documents relating
to the creation, perfection or protection of liens and security interests in
jurisdictions outside of the United States) and do all such other and further
acts and things as the Secured Party may (and, upon the direction of the
Required Banks, shall) reasonably request in order further to evidence or carry
out the intent of this Agreement or to perfect and protect the liens and
security interests created hereby or intended so to be.  In addition, if an
Event of Default or a Potential Default shall have occurred and be continuing,
at the request of the Secured Party each Debtor will execute and deliver to the
Secured Party all notices or instruments, and take all such other actions, as
may be required in order that the security interest of the Secured Party in all
Government Accounts and the Proceeds thereof shall  satisfy the requirements of
the Federal Assignment of Claims Act and any regulations thereunder.

          (b) The Debtors, for the Debtors and their respective successors and
assigns, do hereby irrevocably waive and release all preemptive, first-refusal
and other similar rights of the Debtors to purchase any or all of the Pledged
Securities upon any sale thereof by the Secured

                                      -9-
<PAGE>

Party hereunder, whether such right to purchase arises under the Certificate or
Articles of Incorporation or any By-Law of the issuer of the Pledged Securities,
by operation of law or otherwise.

          (c) The Debtors will maintain the Collateral in good condition and
repair, will give it suitable preventative maintenance in the case of machinery
and equipment, and will pay the cost of all repairs to or maintenance of the
same which may be required from time to time.  The Debtors will not do or permit
to be done anything which might impair the value of any item of the Collateral
owned by any Debtor or the security intended to be afforded hereby.  The Debtors
will immediately notify the Secured Party and the Banks of any event causing any
material loss or depreciation in value of the Collateral and of the extent of
such loss or depreciation.  The Debtors, upon the Secured Party's request, will
permit the Secured Party at any time and from time to time, through its officers
or other agents, to have access to the Collateral for the purpose of inspecting
or, after an Event of Default, assembling and removing the same.

11.       DEFAULT AND REMEDIES.

          (a) The Debtors shall be in default hereunder upon the occurrence of
an Event of Default (as defined in the Credit Agreement).

          (b) Except as otherwise provided in the Credit Agreement with respect
to an Event of Default occurring under Section 10.1(d) thereof, upon the
occurrence of any Event of Default and so long as the same shall be continuing,
the Secured Party may at its option exercise from time to time any and all
rights and remedies available to it under the Uniform Commercial Code or
otherwise, including the right to foreclose or otherwise realize upon any of the
Collateral and to dispose of any of the Collateral at one or more public or
private sales or other proceedings, and the Debtors agree that any of the Banks,
or the nominee of any Bank, may become the purchaser at any such sale or sales.
The Debtors agree that ten (10) days shall be reasonable prior notice of the
date of any public sale or other disposition of all or any part of the
Collateral, or of the date on or after which any private sale or other
disposition of the same may be made.  All rights and remedies granted the
Secured Party hereunder or under any other agreement between the Secured Party
and any of the Debtors shall be deemed concurrent and cumulative and not
alternative, and the Secured Party may proceed with any number of remedies at
the same time or at different times until all the Obligations are fully
satisfied.  The exercise of any one right or remedy shall not be deemed a waiver
or release of or any election against any other right or remedy, and the Secured
Party may proceed against any of the Debtors and the Collateral and any other
collateral granted by any of the Debtors to the Secured Party under any other
agreement, all in any order and through any available remedies.  A waiver on any
one occasion shall not be construed as a waiver or bar on any future occasion.
All property of any

                                     -10-
<PAGE>

kind held at any time by the Secured Party as Collateral shall stand as one
general continuing collateral security for all the Obligations and may be
retained by the Secured Party as security until all the Obligations are fully
satisfied. The Debtors shall pay to the Secured Party on demand any and all
expenses (including reasonable attorneys' fees and legal expenses) which may
have been incurred by the Secured Party, with interest at the Prevailing
Interest Rate, in connection with the custody, preservation, use, operation,
preparation for sale or sale of any of the Collateral, the incurring of all of
which are hereby authorized to the extent the Secured Party deems the same
advisable. The Debtors' liability to the Secured Party for any such payment with
interest at the Prevailing Interest Rate shall be included in the Obligations.
The Proceeds of any Collateral received by the Secured Party at any time before
or after default, whether from a sale or other disposition of Collateral or
otherwise, or the Collateral itself, shall be applied to the payment in full or
in part of such of the Obligations and in such order and manner as the Secured
Party may elect (except as may be otherwise provided in the Credit Agreement),
and the Debtors shall remain liable for any deficiency. Each Debtor to the
extent of its rights in the Collateral waives and releases any right to require
the Secured Party or the Banks to collect any of the Obligations from any
particular Collateral or any other collateral then held by the Secured Party or
the Banks under any theory of marshalling of assets or otherwise.

          (c) If at any time when the Secured Party shall determine to exercise
its rights to sell all or any part of the Pledged Securities pursuant to this
Agreement, such Pledged Securities or the part thereof to be sold shall not, for
any reason, be effectively registered under the Securities Act of 1933 (the
"Securities Act"), the Secured Party is hereby expressly authorized to sell such
Pledged Securities or such part thereof by private sale in such manner and under
such circumstances as the Secured Party may deem necessary or advisable in order
that such sale may legally be effected without such registration.  Without
limiting the generality of the foregoing, in any such event the Secured Party:
(i) may proceed to make such private sale whether or not a registration
statement for the purpose of registering the Pledged Securities or such part
thereof shall have been filed under the Securities Act; (ii) may approach and
negotiate with a restricted number of potential purchasers to effect such sale;
and (iii) may restrict such sale to purchasers as to their number, nature of
business, level of sophistication and investment intention (including without
limitation, to purchasers each of whom will represent and agree to the
satisfaction of the Secured Party that such purchaser is purchasing for its own
account, for investment, and not with a view to the distribution or sale of such
Pledged Securities or part thereof), it being understood that the Secured Party
may require each Debtor, and each Debtor hereby agrees upon the written request
of the Secured Party, to cause:  (i) a legend or legends to be placed on the
certificates to be delivered to such purchasers to the effect that the offering
and sale of the Pledged Securities represented thereby have not been registered
under the Securities Act and setting forth or referring to any required
restrictions on the transferability of such Securities; (ii) the issuance of
stop transfer instructions to such Debtor's own securities and an appropriate
notation to be made in the appropriate records of such Debtor; and (iii) to be
delivered to the purchasers a signed written agreement of such Debtor that such
purchasers will

                                     -11-
<PAGE>

be entitled to the rights of the Secured Party under this Agreement. In
addition, it is understood that such purchasers may be required as a condition
of any such sale to furnish a signed written agreement that the Pledged
Securities will not be sold without registration or other compliance with the
requirements of the Securities Act. In the event of any such sale, each Debtor
hereby consents and agrees that neither the Secured Party nor any Bank will
incur any responsibility or liability for selling all or any part of the Pledged
Securities at a price which the Secured Party or the Banks may deem reasonable
under the circumstances, notwithstanding the possibility that a substantially
higher price might be realized if the sale were public and deferred until after
registration as aforesaid.

          (d) In addition, if at any time when the Secured Party shall determine
to exercise its rights to sell all or any part of the Pledged Securities
pursuant to this Agreement, such transfer may not be effected without approval
of federal or state agencies or authorities, including without limitation
approval of the United States Department of Energy or the United States
Department of Defense or the Federal Trade Commission and the Department of
Justice under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, the
Secured Party is hereby expressly authorized to take all actions as may be
necessary to obtain such approvals and to sell such Pledged Securities  in such
manner and under such circumstances as the Secured Party may deem necessary or
advisable in order that such sale may legally be effected.  In the event of any
such sale, each Debtor hereby consents and agrees that neither the Secured Party
nor any Bank will incur any responsibility or liability for selling all or any
part of the Pledged Securities at a price which the Agent or the Banks may deem
reasonable under the circumstances.

12.       POWER OF ATTORNEY.

          Each Debtor hereby irrevocably appoints any officer, employee or agent
of the Secured Party as such Debtor's true and lawful attorney-in-fact with
power to, upon the occurrence of an Event of Default:  (i) endorse such Debtor's
name upon any notes, checks, drafts, money orders, or other instruments or
payments or other Collateral that may come into the Secured Party's possession;
(ii) sign and endorse such Debtor's name upon any invoices, assignments,
verifications and notices in connection with any of the Collateral, and any
instruments or documents relating thereto or to such Debtor's rights therein;
and (iii) at any time whether or not an Event of Default has occurred, to
execute in such Debtor's name and file one or more financing, amendment and
continuation statements covering the Collateral.  Any such attorney of such
Debtor shall have full power to do any and all things necessary to be done with
respect to the above transactions as fully and effectually as such Debtor might
do, and such Debtor hereby ratifies all that said attorney shall lawfully do or
cause to be done by virtue hereof.

13.       FINANCING STATEMENTS.

                                     -12-
<PAGE>

          Each Debtor shall execute all financing statements and amendments
thereto and continuations thereof as the Secured Party may request from time to
time to evidence the security interest granted, or intended to be granted, to
the Secured Party hereunder and will pay all filing fees and taxes, if any,
necessary to effect the filing thereof.  Wherever permitted by law, each Debtor
authorizes the Secured Party to file financing statements with respect to the
Collateral without the signature of such Debtor.  A copy of this Agreement or a
copy of any financing statement prepared in connection with this Agreement may
itself be filed as a financing statement.

14.       RESIGNATION OR REMOVAL OF SECURED PARTY.

          Subject to the appointment and acceptance of a successor Secured Party
as provided below, the Secured Party may resign at any time by giving at least
60 days' written notice thereof to ICF Kaiser, such resignation to be effective
upon the acceptance of the position of Secured Party by a successor Secured
Party.  The Secured Party may be removed at any time with cause by written
notice from the Required Banks.  Upon any such resignation or removal, the
Required Banks shall have the right to appoint a successor Secured Party which
shall be a bank or trust company selected by the Required Banks if there be such
an institution willing, able and legally qualified to perform the duties of the
Secured Party hereunder upon reasonable or customary terms.  If, within 90 days
of notice of resignation by or removal of the Secured Party, a successor Secured
Party shall not have been appointed, the Secured Party may petition a court of
competent jurisdiction for the appointment of a successor Secured Party. Upon
the acceptance of any appointment as Secured Party hereunder by a successor
Secured Party, such successor Secured Party shall thereupon succeed to and
become vested with all the rights, title, interest and duties of the resigning
or removed Secured Party.  On request of the successor Secured Party or the
Required Banks, the resigning or removed Secured Party shall execute and deliver
such assignments or other instruments and take such other actions as may
reasonably be requested to provide for or evidence the transfer to the successor
Secured Party all rights, title and interest of the resigning or removed Secured
Party (including without limitation the execution and delivery of appropriate
statements under the Uniform Commercial Code), and the resigning or removed
Secured Party thereafter shall be discharged from its duties and obligations
hereunder.  Notwithstanding any such resignation or removal, the Secured Party
shall continue to be entitled to the benefits of Sections 10.5 and 11.8 of the
Credit Agreement in respect of any actions taken or omitted to be taken while it
was acting as Secured Party hereunder.

15.       INSURANCE.

          The Debtors shall maintain insurance at all times in accordance with
the requirements of Section 6.6 of the Credit Agreement.  All such policies of
insurance shall name the Secured Party as lender loss payee and shall provide
for not less than thirty (30) days' prior written notice to the Secured Party of
intended cancellation or reduction in coverage.  The

                                     -13-
<PAGE>

Debtors shall furnish the Secured Party with certificates or other evidence
satisfactory to the Secured Party of compliance with the foregoing insurance
provisions. The Debtors expressly authorize their insurance carriers to pay
proceeds of all insurance policies covering all or any part of the Collateral
directly to the Secured Party.

16.       MISCELLANEOUS.

          (a) This Agreement shall continue in full force and effect so long as
any of the Obligations shall exist from time to time.

          (b) No modification or waiver of any provision hereof shall be
effective unless the same is in writing and signed by the party against whom its
enforcement is sought.  This Agreement may be signed in any number of
counterparts and by different parties in separate counterparts, all with the
same effect as if the signatures were on the same counterpart, and all
counterparts hereof, taken together, shall constitute but one and the same
Agreement.

          (c) The representations, warranties, covenants and agreements
contained herein are all material and continuing, and any breach of any of them
shall constitute a material breach of this Agreement.

          (d) All the rights and remedies of the Secured Party hereunder shall
be cumulative with and not alternative to or in lieu of the Secured Party's
rights and remedies under any other agreement or agreements.

          (e) This Agreement shall bind and inure to the benefit of the parties
and their respective successors and assigns, except that no Debtor shall assign
any of such Debtor's obligations hereunder without the Secured Party's prior
written consent which shall be given at the direction of the Required Banks.

          (f) Any provision hereof which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without affecting the validity or
enforceability of the remainder of this Agreement or the validity or
enforceability of such provision in any other jurisdiction.

          (g) No persons other than the Debtors, the Banks, the Secured Party
and the respective assignees of the Banks and the Secured Party are intended to
be benefitted hereby or shall have any rights hereunder, as third-party
beneficiaries or otherwise.  References in this Agreement to the "benefit of the
Banks" and similar references are intended to refer to an apportionment of
rights and benefits as among the Banks in accordance with the Credit Agreement.

                                     -14-
<PAGE>

          (h) Each Debtor acknowledges that this Agreement and the obligations
of the Debtors hereunder and the security created or intended to be created
hereby have constituted, and were intended by such Debtor to constitute, a
material inducement to the Banks to enter into the Credit Agreement, knowing
that the Banks and the Secured Party will rely upon this Agreement.

          (i) All notices, requests, demands, directions, declarations or other
communications hereunder shall be given in the manner required under the Credit
Agreement.

          (j) All issues arising hereunder shall be governed by and be construed
and enforced in accordance with the laws of the Commonwealth of Pennsylvania
without regard to Pennsylvania or federal principles of conflict of laws.

          (k) Although the intent of the parties is for ICF Kaiser Netherlands
B.V. to create hereby a security interest in Collateral owned by it to the
extent possible under applicable law, the parties acknowledge and agree that,
notwithstanding anything in the Loan Documents to the contrary, the pledge of
the Pledged Securities issued by, and receivables owned by, ICF Kaiser
Netherlands B.V. shall be the subject of separate documentation governed by
Netherlands law to be completed as soon as practicable after the date hereof.

                                     -15-
<PAGE>

     IN WITNESS WHEREOF, this Agreement has been duly executed under due
authorization as of the day and year first above written.

9300 Lee Highway                                ICF KAISER INTERNATIONAL, INC.
Fairfax, VA  22031

                                                By:___________________________
                                                Title:


1339 Chestnut Street                            CORESTATES BANK, N.A., as Agent
P.O. Box 7618
Philadelphia, PA  19107-7618
                                                By:____________________________
                                                Title:

CLEMENT INTERNATIONAL
CORPORATION                                     CYGNA GROUP, INC.


By:______________________________               By:____________________________
Title:                                          Title:

                                                EXCELL DEVELOPMENT
HENRY J. KAISER COMPANY                         CONSTRUCTION, INC.


By:______________________________               By:____________________________
Title:                                          Title:


ICF INFORMATION TECHNOLOGY,
INC.                                            ICF INCORPORATED


By:______________________________               By:____________________________
Title:                                          Title:


ICF KAISER ENGINEERS                            ICF KAISER ENGINEERS
CORPORATION                                     (CALIFORNIA) CORPORATION

                                     -16-
<PAGE>

By:______________________________               By:____________________________
Title:                                          Title:



ICF KAISER ENGINEERS                            ICF KAISER ENGINEERS
MASSACHUSETTS, INC.                             GROUP, INC.


By:______________________________               By:____________________________
Title:                                          Title:


ICF KAISER GOVERNMENT
PROGRAMS, INC.                                  ICF KAISER ENGINEERS, INC.


By:______________________________               By:____________________________
Title:                                          Title:


ICF KAISER HOLDINGS
UNLIMITED, INC.                                 ICF KAISER HANFORD COMPANY


By:______________________________               By:____________________________
Title:                                          Title:


ICF RESOURCES INCORPORATED                      ICF LEASING CORPORATION, INC.


By:______________________________               By:____________________________
Title:                                          Title:


KE SERVICES CORPORATION                         KE LIVERMORE, INC.


By:______________________________               By:____________________________
Title:                                          Title:


KAISER ENGINEERS AND                            KAISER ENGINEERS INTERNATIONAL,
CONSTRUCTORS, INC.                              INC.


By:______________________________               By:____________________________
Title:                                          Title:

                                     -17-
<PAGE>

SYSTEMS APPLICATIONS INTERNATIONAL, INC.        TUDOR ENGINEERING COMPANY


By:______________________________               By:____________________________
Title:                                          Title:


                                                CYGNA CONSULTING ENGINEERS AND
PCI OPERATING COMPANY, INC.                     PROJECT MANAGEMENT, INC.


By:______________________________               By:____________________________
Title:                                          Title:



ICF KAISER SYSTEMS, INC.                        ICF KAISER/GEORGIA WILSON, INC.


By:______________________________               By:____________________________
Title:                                          Title:


GLOBAL TRADE & INVESTMENT, INC.                 ICF KAISER ENGINEERS PACIFIC,
                                                INC.


By:______________________________               By:____________________________
Title:                                          Title:


EDA, INCORPORATED                               ICF KAISER REMEDIATION COMPANY


By:______________________________               By:____________________________
Title:                                          Title:


ICF KAISER OVERSEAS ENGINEERING, INC.           ICF KAISER EUROPE, INC.


By:______________________________               By:____________________________
Title:                                          Title:


ICF KAISER NETHERLANDS B.V.


By:______________________________
Title:

                                     -18-
<PAGE>

                                                 EXHIBIT A TO SECURITY AGREEMENT

                  FORM OF LOCKBOX AND BLOCKED ACCOUNT LETTER


                                    _______________ __, 1996


[Name and address
of Lockbox Bank or
Blocked Account Bank]

          Re:  [ICF KAISER INTERNATIONAL, INC.] [NAME OF GRANTOR]
               -------------------------------- -----------------

Ladies and Gentlemen:

          Reference is made to lockbox no. __________ into which certain monies,
instruments and other properties are deposited from time to time and deposit
account no. ___________ (collectively, the "Lockbox Account") [and the blocked
                                            ---------------
deposit account no. ____________ (the "Blocked Account")]* maintained with you
by [ICF Kaiser International, Inc.] [name of Grantor] (the "Grantor").  Pursuant
                                                            -------
to the Security Agreement, dated as of April __, 1996 (the "Security
                                                            --------
Agreement"), the Grantor has granted to CoreStates Bank, N.A. (the "Agent"), as
---------
agent for the banks referred to therein (the "Banks"), a security interest in
certain property of the Grantor, including, among other things, all now-existing
or hereafter acquired or arising (i) accounts, (ii) general intangibles, chattel
paper, and instruments derived from or related to any accounts, (iii) all
guarantees of any accounts and all other security held for the payment or
satisfaction thereof, (iv) goods or services the sale or lease of which gave
rise to any account, including returned goods, (v) balance of any deposit,
agency or other account with any Bank, (vi) United States government securities
delivered by the Grantor to the Agent, and (vii) all books, records and other
property at any time evidencing or related to the foregoing, together with all
products and proceeds (including insurance proceeds) of any of the foregoing.
It is a condition to the continued maintenance of the Lockbox Account [and the
Blocked Account] with you that you agree to this letter agreement.

          By signing this letter agreement, you acknowledge notice of the
Security Agreement and confirm to the Agent that the description of the Lockbox
Account [and the Blocked Account] set forth on Schedule I hereto is correct and
that you have received no notice of any other pledge or assignment of the
Lockbox Account or the Blocked Account].  Further you hereby agree with the
Agent that:

          (a) Notwithstanding anything to the contrary in any other agreement
    relating to the Lockbox Account [and the Blocked Account], the Lockbox
    Account [and the

______________________
*   All bracketed language to be included in letters regarding Blocked Accounts.
<PAGE>

     Blocked Account] is [are] and will be subject to the terms and conditions
     of the Security Agreement, will be maintained solely for the benefit of the
     Agent, will be entitled "CoreStates Bank, N.A., as Agent, Re: [Name of
     Grantor]" and will be subject to written instructions only from an officer
     of the Agent.

          (b) You will collect mail from the Lockbox Account [and the Blocked
     Account] on each of your business days at times that coincide with the
     delivery of mail thereto.

          (c) You will follow your usual operating procedures for the handling
     of any remittance received in the Lockbox Account [and the Blocked Account]
     that contains restrictive endorsements, irregularities (such as a variance
     between the written and numerical amounts), undated or postdated items,
     missing signatures, incorrect payees, etc.

          (d) You will endorse and process all eligible checks and other
     remittance items not covered by paragraph (c) and deposit such checks and
     remittance items in the Lockbox Account [and the Blocked Account].

          (e) You will maintain a record of all checks and other remittance
     items received in the Lockbox Account [and the Blocked Account] and, in
     addition to providing the Grantor with photostats, vouchers, enclosures,
     etc. of such checks and remittance items on a daily basis, furnish to the
     Agent (i) a monthly statement of the Lockbox Account [and the Blocked
     Account] and (ii) a daily collection and check float report, to be
     transmitted electronically to the Agent at: 215-973-6745.

          (f) You will transfer, in same day funds, on each of your business
     days, all amounts collected from the Lockbox Account [and the Blocked
     Account] on such day to the following account (the "Cash Concentration
                                                         ------------------
     Account"):
     -------

                    ICF Kaiser International, Inc.
                    Account No. [1412209809]
                    CoreStates Bank, N.A.
                    1345 Chestnut Street
                    Philadelphia, PA  19107
                    Attention:  Kathleen Crouse

     Each such transfer of funds shall neither comprise only part of a
     remittance nor reflect the rounding off of any funds so transferred.

          (g) All transfers referred to in paragraph (f) above shall be made by

                                     -21-
<PAGE>

     the undersigned irrespective of, and without deduction for, any
     counterclaim, defense, recoupment or set-off and shall be final, and the
     undersigned will not seek to recover from the Agent for any reason any such
     payment once made.

          (h) All service charges and fees with respect to the Lockbox Account
     [and the Blocked Account] shall be payable by the Grantor, and deposited
     checks returned for any reason shall not be charged to the Lockbox Account
     [and the Blocked Account].

          (i) The Agent shall be entitled to exercise any and all rights of the
     Grantor in respect of the Lockbox Account [and the Blocked Account] in
     accordance with the terms of the Security Agreement, and the undersigned
     shall comply in all respects with such exercise.

          This letter agreement shall be binding upon you and your successors
and assigns and shall inure to the benefit of the Agent, the Banks and their
successors, transferees and assigns.  You may terminate this letter agreement
only upon thirty days' prior written notice to the Grantor and the Agent.  Upon
such termination you shall close the Lockbox Account [and the Blocked Account]
and transfer all funds in the Lockbox Account [and the Blocked Account] to the
Cash Concentration Account.  After any such termination, you shall nonetheless
remain obligated promptly to transfer to the Cash Concentration Account all
funds and other property received in respect of the Lockbox Account [and the
Blocked Account].

                                     -22-
<PAGE>

          THIS LETTER AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE COMMONWEALTH OF PENNSYLVANIA.


                                    Very truly yours,

                                    [ICF KAISER INTERNATIONAL, INC.]
                                    [NAME OF GRANTOR]


                                    By:_________________________
                                     Title:


                                    CORESTATES BANK, N.A., as Agent


                                    By:_________________________
                                     Title:


Acknowledged and agreed to as of
the date first above written:

[NAME OF LOCKBOX BANK OR
BLOCKED ACCOUNT BANK]


By:___________________________
 Title:

                                     -23-
<PAGE>

                                   SCHEDULE I TO EXHIBIT A TO SECURITY AGREEMENT


<TABLE>
<CAPTION>
 Name and Address of Lockbox      Mailing Address of Lockbox      Account
    [Blocked Account Bank]             [Blocked Account]          Number
    ----------------------             -----------------          ------
<S>                               <C>                             <C>
</TABLE>
<PAGE>

                                                 EXHIBIT B TO SECURITY AGREEMENT

[Forms of notices and instruments relating to the Federal Assignment of Claims
Act]
<PAGE>

                                                SCHEDULE A TO SECURITY AGREEMENT

     1.   List of Selected Government Contracts:
<PAGE>

                                                SCHEDULE B TO SECURITY AGREEMENT

     1.  The location of each Debtor's chief executive office and, if not the
same, the location of each Debtor's principal place of business are as follows:

     2.  During the past five years no Debtor has used or been known by any
other name, including any trade or fictitious name, except as follows:
<PAGE>

                                                SCHEDULE C TO SECURITY AGREEMENT

     1.  List of Pledged Securities: